Alkane Resources (ASX:ALK) will acquire Toronto-listed Mandalay Resources through a "merger of equals" transaction, creating a new billion-dollar gold and antimony producer, according to a Monday filing with the Australian bourse.
Under the terms of the deal, Mandalay shareholders will receive 7.875 ordinary shares of Alkane for each ordinary share held. Upon completion, former Mandalay shareholders and existing Alkane shareholders will own roughly 55% and 45%, respectively, of the combined company on an undiluted basis, the filing stated.
The new company will remain listed on the Australian Securities Exchange and seek a listing on the Toronto Stock Exchange. It has an implied market capitalization of AU$1.01 billion.
Around 45% of Mandalay outstanding shareholders plan to vote in favor of the transaction, while 19% of Alkane shareholders intend to do the same, the filing said.
The transaction is subject to a range of conditions, including shareholder and court approvals, as well as regulatory consents. It is expected to close in the third quarter of this year.
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